Government introduces worldwide standards for asset and lease management in state-owned enterprises
In a bid to modernize and systematize asset management within State-Owned Enterprises (SOEs) and Autonomous Bodies (ABs) in Bangladesh, Finance Adviser Salehuddin Ahmed has launched a comprehensive Policy and Procedures Manual for PPE and Lease.
The manual, which was unveiled at a workshop presided over by Finance Division Secretary Md Khairuzzaman Mozumder, aims to enhance efficiency, standardize asset management, and align with international best practices.
Key Features of the Manual
The manual provides comprehensive guidance on managing long-term tangible and intangible assets, including land, buildings, machinery, software, and intellectual property. It features clear classifications and valuation methods for assets, a mandated Fixed Asset Register for detailed recording of asset information, and a capitalization threshold set at Taka 50,000.
The manual also outlines detailed rules for depreciation, amortization, revaluation, and impairment procedures. On lease management, it distinguishes between finance leases (contracts longer than 12 months and valued over Taka 500,000), which require recognition of right-of-use assets and lease liabilities, and operating leases, which are expensed over their term.
Objectives of the Manual
The main objectives of the manual are to improve operational efficiency in asset and lease management, strengthen compliance, enhance the accuracy of financial reporting, ensure optimal utilization of public resources, and bring Bangladesh’s asset management practices in alignment with global accounting standards and best practices.
Emphasis on Accountability and Transparency
Md Khairuzzaman Mozumder urged public entities to maintain updated fixed asset registers to foster greater accountability. He noted that this initiative would transform how public assets are managed. The adviser emphasized the importance of uniformity, transparency, enhancing efficiency, and reducing financial risks in managing public assets.
Alignment with International Standards
The manual aligns with international standards, setting criteria for classifying finance leases and operating leases. It also addresses depreciation or amortization methods, discount rate calculations, and maintenance responsibilities for leased assets.
Workshop Details
The workshop was organized under the Scheme on Strengthening SOE Governance, which is part of the Strengthening Public Financial Management Programme to Enable Service Delivery (SPFMS). Nasrin Sultana, Mohammad Abu Yusuf, and Rahima Begum were guests of honor at the workshop, which took place at the Finance Division in the capital on 7 August.
Md Khairuzzaman Mozumder stressed the importance of accurate asset valuation to improve the credit ratings of SOEs and ABs. He also highlighted that by standardizing procedures nationwide, the initiative aims to reduce irregularities, enhance accountability, and ensure optimal utilization of public resources.
[1] Policy and Procedures Manual for Property, Plant and Equipment (PPE) and Lease
[2] Bangladesh Launches Comprehensive Asset Management Manual for Public Entities
[3] Bangladesh Launches Asset Management Manual for Public Entities
[4] Bangladesh Launches Asset Management Manual for Public Entities
[5] Bangladesh Launches Asset Management Manual for Public Entities
[1] "The Policy and Procedures Manual for Property, Plant and Equipment (PPE) and Lease aims to enhance business efficiencies within the asset management processes of State-Owned Enterprises (SOEs) and Autonomous Bodies (ABs) in Bangladesh."
[2] "This initiative, a part of the Strengthening Public Financial Management Programme, is a significant move in the finance sector of Bangladesh, as it modernizes and systematizes businesses by improving asset management practices in public entities."
